Trump Housing Regulator Issues Warning on Changes to Mortgage Credit Score Policies
Bilt founder and CEO Ankur Jain discusses overwhelming demand after the company expanded its reward programs beyond renters to homeowners on ‘The Claman Countdown.’
FIRST ON FOX: A coalition of advocacy groups is urging the Trump administration’s housing regulator to proceed cautiously with changes to mortgage credit score rules, warning they could increase the risk of another taxpayer-funded housing bailout.
In a letter to Bill Pulte, director of the Federal Housing Finance Agency, the 35 groups laid out three key points to consider as the Trump administration works to make homes more affordable nationwide.
1. Careful Rollout of Competing Credit Score Models
The administration’s plan to allow lenders to choose between traditional and new credit score models must be approached with caution. The coalition warns that poorly designed changes could complicate mortgage lending, distort pricing, and weaken the financial stability of Fannie Mae and Freddie Mac.
THE PRICE OF BUILDING A HOME KEEPS CLIMBING — AND UNCERTAINTY ISN’T HELPING
2. Simultaneous Availability of Credit Score Models
A house for sale in Washington, D.C., on Oct. 19, 2022. (Ting Shen/Xinhua via / Getty Images)
The coalition emphasized that all new credit score models should be introduced simultaneously. Staggered implementation could lead to increased costs for taxpayers, lenders, and borrowers, complicating the accurate assessment of mortgage risk.
3. Public Release of Validation and Approval Data
Additionally, the group requested that the agency release previously undisclosed data used to evaluate new credit score models. They argue that greater transparency would facilitate a smoother transition for lenders and other stakeholders to the new system.
TRUMP’S 50-YEAR MORTGAGE MAY BURDEN AMERICANS WITH MORE DEBT, EXPERTS SAY
The coalition cautioned that past administrations have rushed into policies that pushed unprepared borrowers into homeownership, contributing to widespread mortgage defaults.
Bill Pulte, director of the Federal Housing Finance Agency, is working to make homes more affordable under President Donald Trump. (Ricky Carioti/The Washington Post / Getty Images)
“Too often in the past, families not yet ready to become homeowners have been pushed into it by government regulatory, fiscal, and monetary policies. The result was the 2008 financial crisis, largely driven by many bad mortgages failing at once,” the coalition stated.
The advocacy groups highlighted the sweeping defaults that “triggered a cascade of events that eventually led to multiple taxpayer bailouts.”
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“We are sure you agree that this crisis should never happen again. This risk is particularly acute now, as recent data indicate that mortgage delinquencies are trending upward,” the coalition added.
Read the full letter:
Bilt founder and CEO Ankur Jain discusses overwhelming demand after the company expanded its reward programs beyond renters to homeowners on ‘The Claman Countdown.’
FIRST ON FOX: A coalition of advocacy groups is urging the Trump administration’s housing regulator to proceed cautiously with changes to mortgage credit score rules, warning they could increase the risk of another taxpayer-funded housing bailout.
In a letter to Bill Pulte, director of the Federal Housing Finance Agency, the 35 groups laid out three key points to consider as the Trump administration works to make homes more affordable nationwide.
1. Careful Rollout of Competing Credit Score Models
The administration’s plan to allow lenders to choose between traditional and new credit score models must be approached with caution. The coalition warns that poorly designed changes could complicate mortgage lending, distort pricing, and weaken the financial stability of Fannie Mae and Freddie Mac.
THE PRICE OF BUILDING A HOME KEEPS CLIMBING — AND UNCERTAINTY ISN’T HELPING
2. Simultaneous Availability of Credit Score Models
A house for sale in Washington, D.C., on Oct. 19, 2022. (Ting Shen/Xinhua via / Getty Images)
The coalition emphasized that all new credit score models should be introduced simultaneously. Staggered implementation could lead to increased costs for taxpayers, lenders, and borrowers, complicating the accurate assessment of mortgage risk.
3. Public Release of Validation and Approval Data
Additionally, the group requested that the agency release previously undisclosed data used to evaluate new credit score models. They argue that greater transparency would facilitate a smoother transition for lenders and other stakeholders to the new system.
TRUMP’S 50-YEAR MORTGAGE MAY BURDEN AMERICANS WITH MORE DEBT, EXPERTS SAY
The coalition cautioned that past administrations have rushed into policies that pushed unprepared borrowers into homeownership, contributing to widespread mortgage defaults.
Bill Pulte, director of the Federal Housing Finance Agency, is working to make homes more affordable under President Donald Trump. (Ricky Carioti/The Washington Post / Getty Images)
“Too often in the past, families not yet ready to become homeowners have been pushed into it by government regulatory, fiscal, and monetary policies. The result was the 2008 financial crisis, largely driven by many bad mortgages failing at once,” the coalition stated.
The advocacy groups highlighted the sweeping defaults that “triggered a cascade of events that eventually led to multiple taxpayer bailouts.”
CLICK HERE TO GET FOX BUSINESS ON THE GO
“We are sure you agree that this crisis should never happen again. This risk is particularly acute now, as recent data indicate that mortgage delinquencies are trending upward,” the coalition added.
Read the full letter:
